Vanaspati row hits Sri Lanka's exports to India

The fall in Sri Lanka's exports to India has mainly been due to a spat over shipments of vanaspati, spices and copper.

Vanaspati, the cooking medium that accounts for 22 per cent of Sri Lanka's total exports, led the drop.

"There was a drop in exports to India last year due to problems with vanaspati and even copper exports," said Subhashini Abeysinghe, an economist attached to the Ceylon Chamber of Commerce.

Shipments of vanaspati fell 26 per cent in 2006 from the year-ago period, Abeysinghe said, after India brought in fresh limits to protect her local market. Local manufacturers here were forced to close their plants for about six months, as New Delhi revised the quota order, slashing shipments of vanaspati, she pointed out.

Vehicles dominated India's exports to Sri Lanka with shipments to the tune of Rs3,390 crore, which rose from Rs2,750 crore in 2005.

Other top exports from India included crude oil, cotton, iron and steel, machinery and pharmaceutical products.